issues. After several meetings, the business plan took shape. It was now time to meet once again with the partners and it was time to make history with one of the first privatized public works project in the country more than ten years before President Ronald Regan popularized the concept. Hamilton felt a twinge of pride and accomplishment over his team…Butch Cassidy and the Sundance Kid…these guys were good…no great, and they were writing the history of privatization.
“Let’s see,” Prolano said, “We hire a law firm to represent our firm… that’s not the engineering company? The law firm sends a letter to the County Attorney of the targeted county stating that they represent a firm, qualified and capable of providing a turn-key design/build and managed sewage treatment facility? This company, the letter will confirm will be subject to all law and oversight of the County Attorney, County Engineer and the County Magistrates. It will put up all necessary matching funds and own the facility for a period of 20 years, and at the end of this period, the company will sign over the title to the plant to the County for $1 and other valuable consideration?”
“Thad you know the match on the projects you have identified are a minimum of two million?” Dr. Belini informed. “Obviously, we don’t have those kinds of funds!”
Thad responded, “If the plan is approved, the new corporation would qualify as a special- use corporation, according to both Pearlman and Lorch, under the Industrial Development Authority granted to the county when they built an industrial park. The new corporation will induce the county to issue Revenue Bonds representing 100% of the projected cost required to get the federal funds. In addition, the land will be donated to the project by the county and the cost of the property estimate by a value appraisal would be included in the total estimated cost of the project…therefore, we get all the money required through the sale of taxable bonds purchased by some pension fund.
“What a deal for the politicians and for the community! The pork is passed around and there is plenty for all! It was clear as well that the selection process was ripe for the insidious graft practiced by local politicians. While dangling these major projects for the local and regional engineer the politicos are able to maintain a constant cash flow for campaign coffers through the sale of tickets to various political events. $1,000 here, $500 there from a dozen firms vying for work amounts to a tidy tax-free sum for a Commissioner or Magistrate operating on a salary of $ 35 thousand. Little wonder all these corn seeds are shooting for these part-time activities….so much for doing a little community service!” Pearlman laughed.
The object for the engineer is to maintain contact with the elected representative in order to secure votes for the projects when they finally make their way to the docket. This insidious form of corruption is a way of life for all professions wanting to do business in America, in all communities without exception. Every job let for professional services comes with the implicit history of political activity. Politicians and various political cronies have long memories and any firm unwilling to play “the buy the raffle ticket game”… in the denominations suggested, is ostracized from the game, which puts game, in the form of food, on the table! In some states and communities, the ante is bolder. The political party in power plays out these raids. A corporation gift is never acceptable, only personal checks or cash in brown bags…hence ‘the brown bag man’!
While there is sufficient evidence to prove that there is no profession more vulnerable than that of the engineer to the political spoils, Thad seemed to have found a way around the process. Charles Lorch’s research into the tax structure required for this transaction and Michael Pearlman’s development of the three corporation concept, wholly owned by the engineering company, and all represented autonomously by the renowned law firm of Peabody, Peabody & Helm. Thad had discovered that governmental and political intelligence, operating in an economic vacuum, invariably fail to see the upside of its own leveraged strength, and Pearlman had researched and developed the concept into a legal and professionally acceptable form.
Penny pinchers and fools operate most small cities, counties and towns… most barely high school graduates…and that, in name only. Imagine expecting these folks with the responsibility for finding an extra $ 2 million for a federal match project when the entire county budget would not exceed that amount. Only through frugal savings, the most conservative office holders will tell the taxpayers, can we hope to have the funds required for the match when our number comes up for a new plant. “We must save and sacrifice, that is our fiduciary duty!” Whatever that word means most of the old cronies around the courthouse would be heard saying, and joking that the word really means fuckin’ the old lady!
But they were fucking themselves, up the ass and out the nose. What they failed to understand was that each year ate away whatever savings through inflation and the failure to construct modern infrastructure left most of these little communities out of the competitive loop for new industry and business and with the loss as well, the influx of new taxpayers, the lifeblood of any community. But, in most small towns there is an inbred hostility to change. Most of those who had lived there for generations generally fell into one of five major categories: agricultural, professional (attorney, banker, and accountant) business, service or education. Public Education invariably employed the most folks and therefore carried the most weight politically. A school board in most counties was all balls, regardless of the length of the dress and everybody knew it.
That sense of power and the powerlessness with which it left the next generation was a source of continued consternation for people like Thad Hamilton. Each year the best and the brightest marched off to Chicago, Indianapolis, Los Angeles, Houston, New York or wherever, just to get away from the ‘end of the line’ and backward nature of these communities. “That’s the way it is!” sang the boss.
With the help of competent professionals, Hamilton seemed to have found the route around the political process, and his little engineering firm could begin what they had been trained to do… provide the necessary infrastructure for the communities for a decent return on time and equity! Peabody, Peabody & Helm put the ball in motion.
On a crystal clear morning in May, James W. Seeling, County Attorney for Lake County, Indiana noticed immediately the impressive letterhead of the giant Indianapolis law firm, a place he had hoped to work as a law clerk and the place he had secretly longed to have his name as one of the partners in the skyscraper fronting on Michigan Avenue. He ran his finger across the engraved letterhead…saw his name, and then glanced at the signature of Michael A. Pearlman. He saw Mr. Pearlman in his mind eye, his black hair slicked back with a wet gel, sport coat hanging on the hall tree. He was sporting professionally tailored wool slacks with suspenders over an immaculate starched blue shirt with a white collar and gold cuff links, Gucci loafers with a shine like a…well, bright! He glanced at his own scuffed, worn- heeled Thom McCann’s and thought it may be time to replace them with his Sunday best, which he literally wore only to church.
Seeling read the letter and then reread it. He sat back in his chair, took a cigar from its box, took off the wrapper, placed the plastic tip between his teeth and lit the cigar. Just the ticket, he thought. This little bit of news will guarantee this year’s election and his fifth four-year term as County Attorney. Closer he thought to the magic twenty years and a pension for life before he reached the ripe old age of forty-five. Thank you Lord for Peabody, Peabody & Helm after all! Seeling switched on the intercom; “Get me the Board of Education”.
Pearlman was smooth, not slick, the difference between education and professional experience as opposed to salesmanship. He had cut his teeth on corporate law, served his time in the trenches with the firm before becoming a partner. He was an expert in corporate finance and with Charles Lorch’s acumen on tax law the team was prepared for the hastily called executive session of the County Council, which had been requested by James Seeling.
The presentation was made to open- mouthed members who clearly were in over their heads.
“Simply put,” Seeling said, “Your client, who must remain anonymous
